5 Special topic: World trade slowdown and impacts on the Hungarian economy

Hungary is a small, open economy thus its growth prospects fundamentally depend on the performance of its export markets and the trade intensity of growth. In recent years, the world trade fell short of its pre-crisis dynamics, both in absolute terms and compared to GDP growth. According to the literature, the slowdown may be linked to both cyclical and structural factors. Downside risks stemming from decreasing world trade dynamics may be mainly mitigated by the rise in export market share and the increase in the domestic value added content of Hungarian exports. The special topic below analyses the underlying reasons of the phenomenon and collects the potential conclusions regarding Hungary. Understanding the processes may help assess the Hungarian economic growth prospects more accurately.